EU Wants U.S. Metal-Duties Halt by Year-End, Ambassador Says

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The European Union is working toward having the U.S. lift its national-security tariffs on metal imports by the end of the year, EU Ambassador to Washington Stavros Lambrinidis said.

“We’re going to be sitting down in the next five months until the end of the year -- we’re going to try to address the fundamental issue of overcapacity and the absolute goal for us is that those tariffs have to be lifted,” Lambrinidis said in a virtual discussion hosted by the Wilson Center on Monday. “We have to get rid of those tariffs -- they’re hurting, so many, so many industries.”

Lambrinidis’ remarks come as the transatlantic partners work to improve trade relations that deteriorated under former President Donald Trump. At a summit last week, the two partners agreed to extend a truce over aircraft subsidies for five years, creating breathing space to work out issues in the 17-year dispute that saw tariffs levied on $11.5 billion of exports.

The EU and U.S. also committed to remove tariffs related to the metals dispute, which started in 2018 when the Trump administration imposed a 25% levy on steel imports and a 10% duty on aluminum shipments from countries and regions including the EU in March 2018. The U.S. said they are a threat to national security.

The EU retaliated against the U.S. measures by targeting 2.8 billion euros ($3.3 billion) of American imports with tariffs on a range of big-brand products, including Harley-Davidson Inc. motorcycles, Levi Strauss & Co. jeans and bourbon whiskey.

Hard-hit by the retaliatory tariffs, U.S. whiskey makers for months lobbied for the dispute to be resolved and the duties to be removed.

The U.S. steel industry has called on the Biden administration to work with trade allies to force countries like China to cut down on overcapacity that is depressing global prices.

“At the end of the day, both the European steel and aluminum industries are suffering with overcapacity,” Lambrinidis said. “This overcapacity issue is hurting the EU as much as it’s hurting the U.S.”

‘Systemic Rival’

Last week’s ceasefire over aircraft subsidies was partially driven by a growing awareness across the Atlantic about China’s state-sponsored aerospace manufacturer Commercial Aircraft Corp. of China, or Comac. Earlier this year, the Airbus chief executive officer said Comac was on track to become a legitimate rival to the U.S.-European duopoly by 2030.

On the metal imports, Lambrinidis said the U.S. and EU are “simply sitting at the same side of the table,” and that the two allies’ strategies have “converged” since the 2018 fallout.

“The real issue here is steel overcapacity coming from China,” he said. “That overcapacity of steel and aluminum actually went up during Covid times, as the U.S. was applying the national security tariffs against Europe knocked down. So China’s produced even more.”

The EU won’t “be sitting back and allowing our market to be free and open, while other markets around the world end up being closed and unfair,” Lambrinidis said.

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